Carver v. Haynes

• Decision Date: 26 February 1941
• Docket Number: No. 1259.,1259.
• Citation: 37 F. Supp. 607
• Court: U.S. District Court — Southern District of California
• Parties: CARVER et al. v. HAYNES et al.

37 F. Supp. 607

CARVER et al. v. HAYNES et al.

No. 1259.

District Court, S. D. California, Central Division.

February 26, 1941.

Nichols & Mattoon, of Los Angeles, Cal., for plaintiffs.

William Fleet Palmer, U. S. Atty., James L. Crawford, and John M. Gault, Asst. U. S. Attys., all of Los Angeles, Cal., for defendants.

O'CONNOR, District Judge.

This is a suit in tort to recover for personal injuries alleged to have been sustained on or about the 21st day of March, 1940, while plaintiffs were driving in their automobile on one of the public highways in the County of Los Angeles, State of California, when a motor vehicle belonging to and being operated by the defendants and being driven by the defendant, Robert Young Haynes, suddenly and without warning turned sharply to the left and toward the center of the highway and so ran into and upon and against the automobile being driven by the plaintiff, Grant Carver, and, because of such negligence, it is alleged that both plaintiffs were injured and their automobile was damaged. The complaint alleges that Robert Young Haynes was operating said truck as an employee of W. P. A. and acting within the scope of his employment under authority and supervision of defendants, Herbert C. Legg, as Administrator for W. P. A. of Southern California, Commissioner of Works Projects, and the Federal Works Administrator as agents of the W. P. A. The defendants moved to dismiss on the grounds:

(1) That the Court lacks jurisdiction over the subject matter because it is purely a tort action for negligence.

(2) That the Court lacks jurisdiction over the parties.

(3) That it is improper venue, there being no diversity of citizenship.

(4) That there is insufficiency of service of process.

(5) Because the complaint fails to state a claim against the defendants upon which relief can be granted.

This action is brought under Judicial Code, section 24, amended, Title 28, U.S. C.A. Judicial Code, section 41. The Emergency Relief Appropriation Act, 15 U.S. C.A. §§ 721-728, and the various amendments thereto are set forth in the complaint. Counsel for plaintiffs admits his inability to find any case wherein a tort action brought against the W. P. A. has been decided. The Court has not found such a case.

There are numerous actions, both in contract and in tort, brought against other instrumentalities and agencies of the Federal Government. We find a direct conflict in many of these decisions. In re Walker v. Home Owners' Loan Corporation, D.C., 25 F.Supp. 589, a tort action was instituted against the Home Owners Loan Corporation to recover for personal injury said to have been sustained in a fall from an unsafe chair in which plaintiff was invited to sit by an employee of the defendant while she was at defendant's office for business purposes. District Judge Neterer held defendant could not be sued in tort. A contrary decision was rendered in Re Pennell v. Home Owners' Loan Corporation, D.C., 21 F.Supp. 497. Plaintiff claimed to have been injured by the negligence of the defendant while upon its property. District Judge Peters held the defendant could be sued in tort.

The plaintiff, to sustain his right to sue the W. P. A. for negligence, cites the following: (1) Sloan Shipyards Corp. v. United States Shipping Board Emergency Fleet Corp. 1922, 258 U.S. 549, 42 S.Ct. 386, 66 L.Ed. 762; (2) Gould Coupler Co. v. United States Shipping Board Emergency Fleet Corp., D.C., 1919, 261 F. 716; (3) Federal Sugar Refining Co. v. United States Sugar Equalization Board, D.C., 1920, 268 F. 575; (4) Keifer & Keifer v. Reconstruction Finance Corp. and Regional Agricultural Credit Corp., 1939, 306 U.S. 381, 59 S.Ct. 516, 83 L.Ed. 784; (5) Casper v. Regional Agricultural Credit Corp., 1938, 202 Minn. 433, 278 N.W. 896; (6) Westbrook v. Director General of Railroads, D.C., 1920, 263 F. 211; (7) Salas v. United States, 2 Cir., 1916, 234 F. 842. A careful examination of these cases, in the opinion of this court, does not establish plaintiff's contention.

In re Sloan Shipyards Corp. v. United States Shipping Board Emergency Fleet Corp., supra, "The Shipping Act of September 7, 1916, c. 451; 39 Stat. 728 46 U.S.C.A. § 801 et seq. passed no doubt in contemplation of the possibility of war, to create a naval reserve and merchant marine, established the United States Shipping Board and gave it power to form a corporation under the laws of the District of Columbia for the purchase, construction and operation of merchant vessels * * *. The stock was not to exceed $50,000,000, and the Board was authorized to purchase not less than a majority of such stock. * * * The Shipping Act contemplated a corporation in which private persons might be stockholders and which was to be formed like any business corporation under the laws of the District, with capacity to sue and be sued." 258 U.S. at page 565, 42 S.Ct. at page 387, 66 L.Ed. 762. It is clear the corporation was organized to carry on a business in competition with similar businesses in the United States.

An interesting dissent from this majority opinion was written by Mr. Chief Justice Taft, concurred in by Mr. Justice Van Devanter and Mr. Justice Clarke. 258 U.S. at page 570, 42 S.Ct. at page 389, 66 L.Ed. 762.

In Gould Coupler Co. v. United States Shipping Board Emergency Fleet Corp., supra, the court said: "Section 11 of the Shipping Act (Comp.St. § 8146f 46 U.S. C.A. § 810) provides that the corporation shall be chartered under the laws of the District of Columbia, and no one disputes that this means under its general corporation laws. The corporation was so formed under Code of Law D.C. c. 18, subchapter 4, which authorized actions by and against any corporation so organized. The Fleet Corporation was therefore meant to be a legal person without immunity quite as much as any other corporation." 261 F. at page 717.

The court also refers to the fact that this particular corporation was engaged in industrial and commercial ventures and said: "* * * the governmental agencies used should, whenever it can fairly be drawn from the statutes, be subject to the same liabilities and to the same tribunals as other persons or corporations similarly employed." 261 F. at page 718.

In Federal Sugar Refining Co. v. United States Sugar Equalization Board, supra, the court said: "The defenses rest principally upon the proposition that the defendant was an agent of the sovereign, and that an action against the agent is in effect an action against the sovereign, and that the sovereign cannot be sued without its consent. * * * The agency here concerned is a Delaware corporation. Nothing in section 2, supra, purports to change (if there were power so to do) the rights, duties, obligations, and liabilities of such a corporation. The Congress did not enact any statute incorporating the defendant or specifically providing for its incorporation. Its incorporation was under the laws of Delaware, and the Revised Code of Delaware of 1915 (chapter 65, § 1916) provides:

"`Sec. 2. Powers. — Every corporation created under the provisions of the chapter shall have power. * * * 2. To sue and be sued, complain and defend in any court of law or equity. * * * 8. To conduct business in this state, other states, the District of Columbia, the territories and colonies of the United States and in foreign countries. * * *'

"If the sovereign thus chooses as its agent a state corporation which can be sued it cannot by ipse dixit deprive one injured by such an agent of the right to sue. The state of Delaware allowed defendant to be created, but as a condition of its creation and existence it afforded the right to any one to sue the corporate being which it thus created. It is alleged that, upon `the direction' of the President, defendant was incorporated. This is but another way of saying that the President directed that the necessary number of persons required under the Delaware statute should take the steps necessary under that statute to incorporate a defendant subject to the liabilities of that statute. Neither the Executive nor any person acting with authority under him had the power to change the Delaware statute, and hence no power to change the obligations, rights, or liabilities of a corporation which was the creature of the statute; i. e., the creature of the sovereign state of Delaware." 268 F. at page 584.

In Westbrook v. Director General of Railroads, supra, the railroads placed by law under the supervision of the United States were subject to the laws and to the same statutes as they had been formerly, except as modified by Congressional act. The court said: "The denial of the right to levy was a sufficient protection, if not the limit of Congressional authority as to suits against these corporations on their liabilities. But as applied to the governmental operation of the transportation systems every provision becomes a code. The first sentence, declaring that the carriers, while under federal control, shall be subject to all laws and liabilities as common carriers, state, federal, or at common law, created a liability on the part of the United States for every act and omission for which liability had formerly attached to the owners in their business as common carriers. The reserved right to alter these by orders of the President was a power to quickly withdraw this liability to any extent found to be needful. Thus Congress made the railroads' liabilities to patrons, employes, and the public arising under federal control to be `claims against the United States.'" 263 F. at page 216.

In Casper v. Regional Agricultural Credit Corp., supra, the defendant was a creature of the Reconstruction Finance Corporation pursuant to section 605b (e) of the act under which the Reconstruction Finance Corporation was organized. 15 U.S.C.A. §§ 601-617. Under the authority granted to the Reconstruction Finance Corporation it created a defendant. The court said: "The inference that defendant is...